India’s regulator consults on minimum prices

India’s regulator, TRAI, is to meet telecom service providers to seek their views on minimum floor prices for voice and data tariffs, reports the Hindustan Times. “The minimum floor price, for both data and voice calls, has been demanded by incumbent telecom operators, but implementing it could mean an end to freebies in the market. Also, the tariffs are currently under forbearance – operators virtually have a free hand in fixing the rates and report plans to TRAI within 7 days of launch – and, hence, a floor price setting, if it happens, would imply a shift from that regime. During the meeting, TRAI will seek the rationale for the floor price demand, and is also expected to ask the telcos why an upper ceiling for tariffs is not similarly justified. Highlighting the growing financial stress on operators, Idea Cellular has said that the industry has been witnessing losses and negative returns driven by below cost tariffs that are ‘predatory’. “The only solution is to have floor prices for voice, SMS and data services so mobile telecom businesses generate adequate profits to invest and then compete based on quality of services,” it said, citing nations like Sri Lanka, Zimbabwe and Bangladesh which have such floors. Read more